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Interest Rate Contracts
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6 Months Ended |
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Jun. 30, 2011
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
| Interest Rate Contracts | Interest Rate Contracts The indebtedness encumbering the Sunset Gower property and Technicolor Building until its repayment on June 29, 2010 in connection with the IPO and related formation transactions was subject to an interest rate contract. An interest rate contract that capped one-month LIBOR at 4.75% on the notional amount and on terms identical to the principal amount and terms of the mortgage loan was in effect through March 15, 2010. The fair market value of that interest rate cap agreement at June 30, 2010 and December 31, 2010 was $0 (having expired on March 15, 2010). The indebtedness encumbering the Sunset Bronson property was subject to a collar on the LIBOR portion of the interest rate of not less than 2.55% and no greater than 3.87% until September 1, 2010. We had not designated the interest rate collar agreement as a hedging instrument for accounting purposes; therefore, the change in the fair value of the derivative instrument is reported in current earnings. From and after June 1, 2010, the applicable interest rate became 5.90% per annum, until a new secured interest rate contract went effective upon the closing of the IPO and related formation transaction on June 29, 2010, which swapped one-month LIBOR to a fixed rate of 0.75%. The interest rate contract for Sunset Bronson fixed one-month LIBOR on the full $37.0 million notional loan amount through April 30, 2011 on terms identical to the terms of the mortgage loan. We designated this interest rate swap as a cash flow hedge for accounting purposes. On February 11, 2011, we closed a five-year term loan totaling $92.0 million with Wells Fargo Bank, N.A., secured by our Sunset Gower and Sunset Bronson media and entertainment campuses. The loan bears interest at a rate equal to one-month LIBOR plus 3.50%. $37.0 million of the loan is currently subject to the above described interest rate contract, which swapped one-month LIBOR to a fixed rate of 0.75% through April 30, 2011. On March 16, 2011, we purchased an interest rate cap in order to cap one-month LIBOR at 3.715% on $50.0 million of the loan through its maturity on February 11, 2016. Proceeds from the loan were used to fully refinance a $37.0 million mortgage loan secured by our Sunset Bronson campus that was scheduled to mature on April 30, 2011. We designated this interest rate cap contract as a cash flow hedge for accounting purposes. The fair market value of the interest rate cap at June 30, 2011 was $631 and interest rate swap at June 30, 2011 and December 31, 2010 was a $0 and $71, respectively. |